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Coupang Cleared of Allegations Regarding ‘Mass Resignation’ of SNL Korea Staff

[비즈한국] Coupang has won a 3.5 billion won lawsuit filed by AStory241840, the production company for SNL Korea reboot seasons 1–4. The production house had alleged that PD Ahn Sang-hwi, who previously headed their production division, colluded with a Coupang subsidiary to poach the entire SNL Korea production team. The case escalated into a legal battle over breach of trust and "poaching staff." The court ruled in favor of Coupang, stating that the employees resigned voluntarily and there was insufficient evidence that Coupang or the producer had coerced them into moving.

Court Rejects Production Company's Claim of "Coupang Hijacking Entertainment Division"

A court ruling has been issued regarding the mass resignation of the staff of SNL Korea, Coupang Play's flagship variety show, who moved from their production company to CP Entertainment, a Coupang subsidiary. On the 11th of last month, the 62nd Civil Division of the Seoul Central District Court (Presiding Judge Lee Hyun-seok) ruled in favor of Coupang in the lawsuit filed by AStory against PD Ahn Sang-hwi and Coupang's subsidiaries, which alleged business interference and damages.

The incident dates back two years. At the time, PD Ahn, then the head of Production Division 2 at AStory, notified the company in early September of his intent to move to CP Entertainment (CP Ent.), a content production and talent agency under Coupang. Subsequently, from mid-November of the same year, 11 employees of Production Division 2, including PD Oh Won-taek, who directed 'Life Bar', submitted their resignations and joined CP Ent. PD Ahn moved to CP Ent. in mid-December, at the time his contract expired.

Production Division 2 was a newly created unit at AStory after the company recruited PD Ahn, who had directed SNL Korea at CJ ENM's tvN. SNL Korea is divided into the series produced by CJ ENM, which ended with season 9 in 2017, and the reboot series revived by AStory after re-acquiring the rights in 2021. Upon initiating the lawsuit in January of last year, AStory stated, "This is a case where the massive corporation Coupang and a department head belonging to AStory enticed staff members to snatch away AStory's variety show division."

The court dismissed the claims filed by the production company and partially upheld a counterclaim by PD Ahn, ordering AStory to pay 50 million won, part of the 280 million won he claimed in unpaid writing and directing fees according to his contract.

While the court acknowledged that the entire staff of the division had moved to a competitor’s subsidiary, it ruled that there was no illegality. It found that the employees left voluntarily and that there was insufficient evidence that PD Ahn, CP Ent., or Woodada Studio (a content production company founded by PD Ahn and his spouse) had colluded to force the move.

The first-instance court explained, "The fact that office layouts and fixtures were shared and that some employees were encouraged to submit resumes is insufficient to prove that PD Ahn and CP Ent. directed the mass resignation." The court rejected all arguments by the production company, which had pointed to an alleged breach of fiduciary duty by PD Ahn, breach of trust, and unfair trade practices by Coupang's subsidiary.

The court also considered the fact that the Fair Trade Commission, after an investigation triggered by AStory's report, dismissed the case due to "lack of evidence for unfairness," and the police investigation into allegations of obstruction of business concluded without charges.

Claims of Trade Secret Misappropriation Also "Unproven"

The court also found no evidence to support claims that the defendants were working on Coupang's new variety show projects before their departure or that they helped CP Ent. secure production contracts for 'SNL Season 5' and 'Sindorim Sunday Soccer Club.' Specifically, the court ruled, "It appears that the employees routinely updated casting lists and project proposals for the next season after each season ended, and the project proposal for Season 5 identified the plaintiff (AStory) as the producer, indicating that they were performing work for AStory."

The variety show 'Sindorim Sunday Soccer Club: Tottenham & Munich Edition,' released on Coupang Play in 2024, filmed overseas soccer players visiting Korea and was interpreted by the court as distinct from the program AStory was planning at the time, which was premised on overseas filming.

Furthermore, while AStory argued that the defendants attempted to misappropriate trade secrets, including production documents for the dramas 'Signal' and 'Kingdom,' as well as SNL Korea project proposals, contracts, and scripts, the court ruled that these documents did not constitute trade secrets. The court noted that no access restrictions were in place, no confidentiality obligations were imposed, and there was no evidence that the defendants had leaked such information.

On the other hand, regarding PD Ahn's demand for "unpaid writing fees," the court ruled, "There is an obligation to pay 50 million won in interim payments for works that have reached the maturity date, along with delayed damages."

With this ruling, the allegations of unfair trade practices and improper poaching of personnel by Coupang appear to have been laid to rest. A Coupang official stated, "The court judged that Coupang won completely in the lawsuit filed by AStory. Harassing former employees who have left the company through meaningless lawsuits should stop."

AStory did not provide a separate official statement regarding this outcome.